Research Reports from the Department of Operations
Document Type
Report
Publication Date
10-1-1970
Abstract
This paper summarizes work performed in evaluating shortage costs associated with stockouts for each of a manufacturer's seven thousand catalogued line items. A modified version of a decision tree model proposed by Yu Chang is employed in a determination of estimated unit shortage costs for a stratified random sample of items. The results are then extended to all items on the basis of an excellent correlation between the evaluated unit shortage costs and unit gross profits of the items in the sample.
Keywords
Operations research, Inventory control, Inventory shortages, Sampling (Statistics), Manufacturing industries--Mathematical models, Production management, Business logistics--Mathematical models
Publication Title
Technical Memorandums from the Department of Operations, School of Management, Case Western Reserve University
Issue
Technical memorandum no. 205
Rights
This work is in the public domain and may be freely downloaded for personal or academic use
Recommended Citation
Oral, Muhittin; Salvador, Michael S.; Reisman, Arnold; and Dean, Burton V., "On the Evaluation of Shortage Costs for Inventory Control" (1970). Research Reports from the Department of Operations. 366.
https://commons.case.edu/wsom-ops-reports/366